Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2016

Sales and Use Tax Annotations

295.0000 GROSS RECEIPTS

Annotation 295.0747

(a) GENERAL

295.0747Use Tax Is Due on Agreed Sales Price. An individual sold a vessel to a purchaser, as agent for a corporation, for an agreed sales price of $60,000. The purchaser seeks to reduce the agreed sales price as the measure of tax on the basis of allegations of fraud set forth in current litigation with the seller.

Once a sales price is agreed upon and a transaction completed based thereon, a dispute thereafter between seller and purchaser as to the price does not have any bearing on the use of the agreed price in computing the use tax, Southern California Edison Co. v. State Board of Equalization 7C 3d 652 (1972). The court stated, "An overall view of the sales and use tax statutory scheme, however, indicates that the Legislature intended the sales price and gross receipts terminology of sections 6011 and 6012 to refer to the price agreed upon at the initial sales transaction and not to the net amount which the buyer ultimately pays for the goods purchased." (emphasis is that of the court). Even if subsequently there is a settlement or adjudication concerning the vessel, it would not have the effect of reducing the initial agreed sales price on which the tax was predicated. 9/8/75.

Do you have feedback about the BOE website?

Share it with us in the text boxes below!
Please keep in mind that you will not receive a response upon sharing your feedback with us.

If you need help with tax questions, online services, or payment please call the BOE Customer Service Center at 1-800-400-7115.

For your security, please do not include any private information such as social security numbers or contact information when submitting this form.
Thank you for helping us improve the California taxpayers' experience on boe.ca.gov.

Were you able to easily find the information you were seeking?

What changes would you make to this page to improve the user's experience?